Govan Law Centre (GLC) has given oral evidence before the Scottish Parliament’s Delegated Powers and Law Reform Committee on the Moveable Transactions (Scotland) Bill, on Tuesday 4 October 2022.
The Bill introduces a new Register for Statutory Pledges for businesses and consumers for any moveable goods (worth £1,000 or more for consumers), meaning that goods could be secured on a loan with the debtor retaining possession of the goods unless they default on payment. The Bill would also introduce a Register of Assignations to enable debts to be assigned online without written notification to debtors.
GLC, along with other consumer bodies and advice agencies in Scotland, believe that consumers should be excluded from the scope of the Moveable Transactions (Scotland) Bill. We believe that if the Bill was passed as drafted, it would expose vulnerable Scottish consumers to high-cost predatory lending with considerable scope for mis-selling and significant consumer detriment in a cost of living crisis.
Statutory Pledges are equivalent to English law “Bills of Sale” which are used in other parts of the UK to provide “Log Book Loans” – credit at several hundred percent per annum (APR) that is secured over a person’s motor vehicle, with the ability for that vehicle to be repossessed on a single default.